Asston Pharmaceuticals Limited has launched its Initial Public Offering (IPO) on BSE SME platform with an aim to raise ₹27.56 Crores via a Book Built Issue. The IPO opens for subscription on July 09, 2025, and closes on July 11, 2025. The allotment is expected to be finalized by July 14, 2025, and the shares will be listed on BSE SME around July 16, 2025.

About the Company

Asston Pharmaceuticals is engaged in manufacturing and exporting pharmaceutical formulations and nutraceutical products across India and multiple African markets. Operating under the “Asston” brand, the company manufactures and markets:

• Tablets

• Capsules

• Oral Liquids

• External Preparations (Ointment, Cream, Gel, Lotion)

• Oral Powder (Sachet, Dry Syrup)

Their strength lies in their product diversity, enabling them to serve domestic as well as international demand, particularly in Africa.

IPO Details at a Glance

• Issue Type: Book Built Issue

• Issue Size: ₹27.56 Crores

• Fresh Issue: 22.41 lakh shares

• Price Band: ₹115 to ₹123 per equity share

• Market Capitalisation at ₹123: ₹104.70 Crores

• Lot Size: 1,000 shares

• Minimum Investment (Retail): 2 lots = 2,000 shares = ₹2,46,000

• Subscription Period: July 09–11, 2025

• Tentative Allotment Date: July 14, 2025

• Tentative Listing Date: July 16, 2025

• Exchange: BSE SME

Sobhagya Capital Options Private Limited is the Book Running Lead Manager (BRLM), while Maashitla Securities Private Limited is the Registrar to the Issue. JSK Securities and Services Private Limited acts as the Market Maker for this IPO.

Anchor Investors Participation

Asston Pharmaceuticals has successfully raised ₹7.81 Crores from Anchor Investors at the upper band price of ₹123 per share. A total of 6,35,000 equity shares were allocated to Anchor Investors, showcasing institutional confidence in the company's prospects.

Grey Market Premium (GMP) Insight

As of July 04, 2025, the Grey Market Premium (GMP) stands at ₹22, indicating an expected listing price of ₹145. This suggests a potential listing gain of around 17.88%. However, GMP is purely indicative and based on unofficial demand and supply, making it an unreliable predictor of actual listing performance.

Live Subscription Status

As of 12:00 PM on July 11, 2025 (final day), the Asston Pharmaceuticals IPO was subscribed 38.28 times, reflecting strong investor interest, particularly from retail and HNI segments.

This robust demand underscores the company's appeal in the SME IPO space, bolstered by its export exposure and diversified product portfolio.

Financial Performance and Growth

Asston Pharmaceuticals has demonstrated consistent financial growth, driven by both domestic and export demand. Below is a detailed look at the company's financial highlights:

• Revenues from Operations:

  • FY23: ₹719.19 Lakh

  • FY24: ₹1,584.09 Lakh

  • FY25: ₹2,561.02 Lakh

  • Period ended May 31, 2025: ₹620.93 Lakh

• EBITDA:

  • FY23: ₹217.05 Lakh

  • FY24: ₹280.06 Lakh

  • FY25: ₹673.03 Lakh

  • Period ended May 31, 2025: ₹194.90 Lakh

• Profit After Tax (PAT):

  • FY23: ₹105.66 Lakh

  • FY24: ₹136.03 Lakh

  • FY25: ₹432.51 Lakh

  • Period ended May 31, 2025: ₹132.24 Lakh

These numbers clearly indicate strong, steady growth across key financial parameters, showcasing the company's ability to scale operations profitably.

Valuation Metrics

• Pre-Issue EPS (FY24): ₹6.9

• Post-Issue EPS (FY24): ₹5.08

• Pre-Issue P/E Ratio: 17.83x

• Post-Issue P/E Ratio: 24.21x

• Annualised EPS: ₹9.32

• Annualised P/E Ratio: 13.20x

These figures indicate that the IPO is fully priced relative to its growth trajectory, with the P/E ratio reflecting market expectations of continued expansion.

Return Ratios

• ROCE (FY24): 51.25%

• ROE (FY24): 50.56%

• RoNW: 40.36%

These impressive return ratios signal efficient use of capital and strong profitability, making Asston Pharmaceuticals stand out among SME peers.

Management Team

The company is led by:

• Dr. Ashish Sakalkar

• Mrs. Saili More

• Mr. Sachin Badakh

This experienced leadership team brings expertise in formulations, market operations, and exports, critical for scaling in the pharmaceutical sector. Their track record and vision have been key drivers of the company’s rapid growth.

Objectives of the IPO

The company plans to use the Net Proceeds as follows:

1. ₹630.0 Lakhs – For capital expenditure towards acquiring machinery for its manufacturing unit.

2. ₹1,300.00 Lakhs – For incremental working capital requirements.

3. ₹100.00 Lakhs – For repayment/prepayment of certain borrowings.

4. General Corporate Purposes – To support business expansion and operational needs.

This clear use of funds highlights management's focus on capacity expansion, debt reduction, and working capital management to support sustainable growth.

Strengths of Asston Pharmaceuticals Ltd

• Diversified Product Portfolio: Catering to a wide range of formulations, enhancing market reach.

• Strong Export Focus: Presence in African markets boosts revenue stability.

• Experienced Leadership: Proven track record in pharmaceutical exports and operations.

• High Subscription Demand: 38.28x subscription reflects investor confidence.

• Impressive Return Ratios: High ROCE and ROE signal efficient capital utilisation.

Risks and Considerations

• SME Platform Constraints: Lower post-listing liquidity and higher volatility.

• High Minimum Investment: ₹2.46 lakh may limit retail participation.

• Price Band Sensitivity: Final issue price depends on book-building demand.

• Competitive Industry: Pharmaceutical market is highly competitive with evolving regulations.

• GMP Limitations: Grey market trends are purely speculative and unregulated.

GMP Trend and Listing Outlook

The ₹22 GMP indicates possible listing gains of ~17.88%, suggesting solid listing sentiment. However, real listing price will depend on:

• Overall market conditions.

• Sector sentiment.

• Post-allotment demand-supply dynamics.

• General investor risk appetite in SME IPOs.

Investors should be aware that GMP is not a formal pricing mechanism, and listing price can differ from these expectations.

Investor Perspective

Asston Pharmaceuticals IPO offers exposure to India’s fast-growing pharmaceutical sector, backed by diverse products and export markets. The strong subscription response, robust financials, and high return ratios make it an appealing choice for risk-seeking investors.

However, it is important to remember:

• The SME platform can see high volatility.

• The high minimum investment requires careful allocation.

• The IPO appears fully priced, with no deep value discount.

Conclusion

For investors with moderate to high risk appetite, Asston Pharmaceuticals IPO offers an opportunity to invest in a fast-growing pharma company with strong financial fundamentals, experienced leadership, and clear expansion plans.

It is best suited for long-term investors who believe in the pharma export story and are comfortable with SME IPO dynamics.

Disclaimer:
This analysis is for educational and informational purposes only. It does not constitute investment advice or a solicitation to buy or sell any securities. Investors should perform their own due diligence or consult a SEBI-registered financial advisor before making any investment decisions. All data is based on information available as of the publication date and may be subject to change.

The Upcoming IPOs in this week and coming weeks are Savy Infra, Monika Alcobev, NSDL.

The Current active IPO are Anthem Biosciences, Spunweb Nonwoven.

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